All posts tagged KB Home

Rising home prices and higher interest rates continue to sap the momentum of new-home sales as two national home builders reported Tuesday that their pace of new orders slowed in their most recent quarter.

Lennar Corp. and KB Home gave differing reasons for their relative shortfalls in orders, though analysts were generally pleased with the builders’ quarterly results. Lennar’s stock closed Tuesday at $36.01, up 4.3%, in 4 p.m. composite trading on the New York Stock Exchange. KB Home’s stock finished at $17.76, also up 4.3%.

For new orders, Lennar posted a 14% gain for its quarter ended Aug. 31 from the same period a year ago in comparison with analysts’ expectations of a 24% gain. Lennar executives noted that buyers now are more hesitant due to rising rates, concerns about federal budget negotiations and double-digit percentage increases in home prices this year. Read More »

LAS VEGAS — Builders have spent years rolling out one environmentally friendly feature after another, only to see underwhelming interest from consumers. But now they are taking a different approach: They’re playing up economics and, increasingly, including green features at no extra cost.

KB Home just unveiled a “ZeroHouse 2.0 ” near Washington, D.C., its first home promising a zero energy bill in the mid-Atlantic. It joins similar models in markets including Las Vegas and Orlando. Meritage Homes Corp. has dedicated entire communities in Phoenix and Tucson to its greenest homes, while Shea Homes, a large private builder, has made green features standard in 10 communities nationwide since February.

There are signs that this pocketbook push might be paying off: KB Home says that in its Southern California communities with solar as a standard feature, traffic from potential buyers is 30% higher than in those where it costs extra. And Shea says sales at all-green homes are significantly topping expectations. “We hear every week from our front lines that having the net-zero product included in the price is making a difference,” says Rick Andreen, president of Shea Homes Active Lifestyle Communities. Read More »

That’s the headline from the American Institute of Architects’ first-quarter Home Design Trends Survey set to be released Thursday. Eight percent of the 500 architecture firms responding say square footage of homes increased in the first quarter, up from 5% a year ago. This change, the biggest year-over-year jump since the survey started in 2005, ends a multiyear march toward smaller homes driven by the housing implosion. “We’ve begun to turn the corner here after a steep downturn,” says Kermit Baker, the Washington, D.C.-based architecture group’s chief economist.

Want more evidence? Trulia’s Chief Economist Jed Kolko wrote this week that 27% of Americans say their ideal home size is over 2,600 square feet, up from 17% in 2011. Those expressing interest in the “super-sized” house category, 3,200 square feet and above, climbed to 11% from 6%. Read More »

KB Home, one of the home-building sector’s largest and most-watched companies, reported disappointing quarterly results Friday morning, losing $45.8 million, or 59 cents a share, in the first quarter of 2012.

While this is a narrower loss from the a year earlier (KB got clobbered in the first quarter of 2011, losing $114.5 million), the results have analysts and investors spooked, mainly because the company, which is based in Los Angeles, reported dismal orders. The number of buyers under contract for KB Home’s houses totaled 1,197 homes, down 8.1%.

Wall Street had predicted an uptick in orders. More troubling is that orders are down most on the West Coast and in the Southwest, markets where KB has spent lots of money in the last year and a half buying land and building new communities. We listen in on the company’s quarterly earnings call and report the play-by-play.

New-home sales fell for the fourth-straight month in August to the lowest level in a half-year as the bursting of the housing bubble continues to plague the U.S. economy.

Sales fell by 2.3% on a monthly basis to a seasonally adjusted annual rate of 295,000, the Commerce Department said Monday. It was the weakest pace in six months and the seventh-worst month on records dating back to 1963.

The results, however, were in line with forecasts, and July’s results were revised upward slightly to a rate of 302,000. Compared with a year earlier, when new home sales hit a record-low pace of 278,000, new home sales were up 6.1%. Read More »

For months, some J.P. Morgan notes to home-building clients have mentioned a “positive sector stance,” with a view that housing should continue to stabilize and slowly recover over at least the next 24 months.

But the building sector weakened significantly, hurt by foreclosures, depressed home values, unemployment and consumers too nervous to leave the sidelines. The DJ builder index has tumbled nearly 30% this year. Earlier this week, the National Association of Home Builders, the building sector’s biggest trade group, said its confidence index slipped in September, indicting even more pain ahead.

That’s why we weren’t surprised to see J.P. Morgan change course today. The firm will now be “more selective in our approach to the home-building sector,” analyst Michael Rehaut wrote in an early-morning note. The firm downgraded KB Home to neutral from overweight and Hovnanian to underweight from neutral. He also raised Standard Pacific to neutral, from underweight. Read More »

Fitch Ratings cut a trio of home builders deeper into junk territory Monday, pointing to a dismal outlook for new housing activity as well as liquidity pressures at the struggling home builders. Five years into a housing downturn, questions have mounted in recent months about how long some publicly traded home builders can survive without significant market improvement.

“We’re not suggesting things like imminent default,” said Fitch Ratings home-builder analyst Robert Curran. “We would rate it lower still if we thought that was the case. The point we’re making is that there are some ongoing significant pressures for the builders, and some of these builders are in a particularly bad situation, and it’s up to those builders and their management teams to fix that in the next few quarters.” Read More »

Sales of new homes increased in March from a record low a month earlier, a small boost for a struggling part of the U.S. economy. Sales grew 11.1% on a monthly basis to a seasonally adjusted annual rate of 300,000 in March, the Commerce Department said Monday.

Results for the previous two months were revised upward, but February remained the worst month on the government’s records, which go back to 1963. Economists cautioned against concluding that the new-homes market is on the rebound.

“Even with this improvement, the data on new home sales has remained in a very depressed range,” over the past year, wrote J.P. Morgan economist Daniel Silver. While sales of previously occupied homes have shown modest improvement over the past year, the market for new homes is faring far worse, he noted. Read More »

These are still tough days for the U.S. housing market. Prices continue to falling, even as the country slowly emerges from recession. Last year was the worst year on record for new home sales, according to the Commerce Department. But even in this climate, builders are striving to be innovative.

On Tuesday, the WSJ’s Robbie Whelan interviewed Jeffrey Mezger, chief executive of KB Home. The company just launched its Energy Performance Guide system, which is sort of like the miles-per-gallon rating used by the auto industry, only for houses.

These are still tough days for the U.S. housing market. Prices continue to fall, even as the country slowly emerges from recession. Last year was the worst year on record for new home sales, according to the Commerce Department. But even in this climate, builders are striving to be innovative.

On Tuesday, the WSJ’s Robbie Whelan interviewed Jeffrey Mezger, chief executive of KB Home. The company just launched its Energy Performance Guide system, which is sort of like the miles-per-gallon rating used by the auto industry, only for houses. Read More »

One of the nation’s largest builders is borrowing from another beleaguered industry—automotive—to help sell homes. KB Home just announced its Energy Performance Guide, dubbed the “EPG.”

Modeled after a car’s MPG, which tells buyers how many miles can be driven on a gallon of gas, EPG estimates a home’s monthly utility payments. The EPG scale—a lower score means higher energy efficiency and lower bills—will be posted in all model homes.

The rating is the latest idea from builders as they compete to one-up each other with environmentally friendly features.

For years, green homes were too pricey to be mass produced and it’s only in the last few years that prices have fallen enough for big builders to tap the technology. Buyers, meanwhile, have long been more concerned about location and price than eco-friendly features. Read More »